Government sues ex-Cendant chief for $22M in assets

Federal officials and the company formerly known as Cendant Corp. filed suit today to recover more than $22 million in assets they claim imprisoned former Cendant Chairman Walter Forbes transferred after his massive accounting fraud was uncovered a decade ago.

The lawsuit, filed in federal court in Hartford, Conn., targets cash, securities and real estate that federal prosecutors claim Forbes transferred to his wife, daughters and two trusts with the help of a long-time family lawyer and an accounting firm.

Christopher Christie, the U.S. attorney for New Jersey, issued a statement contending the transfers unfolded after Cendant announced on April 15, 1998, the discovery of a massive accounting fraud that forced the travel and real estate company's market value to plunge $14 billion or by 46 percent.

"Forbes knew the law was catching up with him, and it was for that reason that he moved with such stealth and purpose to shelter his assets. It is our intention to get back every dollar of those assets available to us under the law," Christie said in a prepared statement.

The Cendant debacle was among the first in a long series of major corporate accounting scandals over the past decade that left investors short, ruined retirement plans and created a national public outrage over corporate mismanagement and greed.

Forbes denied his guilt, but he was convicted after a federal court trial in Connecticut in October 2006 of participating in a scheme to inflate the stock of Cendant's predecessor, CUC International, by $500 million. Last year, he began serving a sentence of 12 years and seven months, and he was ordered to pay nearly $3.3 billion in restitution.

The lawsuit, jointly filed by the U.S. Government and Avis, formerly Cendant, targets the Forbes family home in New Canaan, Conn., among other things. Forbes transferred it into his wife's name for $10 in 1999, when authorities said it was worth $10 million to $15 million.

Christie, in a press release, said Forbes, with the help of his personal attorney, Robert T. Tucker, and the Buck & Sturmer accounting firm, transferred his personal assets between June 1998 and December 1999 to his family and various trust accounts.